SECOND DIVISION

[G.R. No. 139786. September 27, 2006.]

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs.

CITYTRUST INVESTMENT PHILS., INC., respondent.

[G.R. No. 140857. September 27, 2006.]

ASIANBANK CORPORATION , petitioner, vs. COMMISSIONER

OF INTERNAL REVENUE, respondent.

DECISION

SANDOVAL-GUTIERREZ, J : p

Does the twenty percent (20%) final withholding tax (FWT) on a bank's
passive income 1 form part of the taxable gross receipts for the purpose of
computing the five percent (5%) gross receipts tax (GRT) ? This is the central
issue in the present two (2) consolidated petitions for review.
I n G.R. No. 139786, petitioner Commissioner of Internal Revenue
(Commissioner) assails the Court of Appeals Decision dated August 17, 1999
in CA-G.R. SP No. 52707 2 affirming the Court of Tax Appeals (CTA) Decision 3
ordering the refund or issuance of tax credit certificate in favor of
respondent Citytrust Investment Philippines., Inc. (Citytrust). In G.R. No.
140857, petitioner Asianbank Corporation (Asianbank) challenges the Court
of Appeals Decision dated November 22, 1999 in CA-G.R. SP No. 51248 4
reversing the CTA Decision 5 ordering a tax refund in its (Asianbank's) favor.
A brief review of the taxation laws provides an adequate backdrop for
our subsequent narration of facts.
Under Section 27(D), formerly Section 24(e)(1) of the National Internal
Revenue Code of 1997 (Tax Code), the earnings of banks from passive
income are subject to a 20% FWT, 6 thus:
(D) Rates of Tax on Certain Passive Incomes —
(1) Interest from Deposits and Yield or any other Monetary
Benefit from Deposit Substitutes and from Trust Funds and Similar
Arrangements, and Royalties . — A final tax at the rate of twenty
percent (20%)is hereby imposed upon the amount of interest on
currency bank deposit and yield or any other monetary benefit from
deposit substitutes and from trust funds and similar arrangements
received by domestic corporation and royalties, derived from sources
within the Philippines: . . .

Apart from the 20% FWT, banks are also subject to the 5% GRT on their
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 gross receipts, which includes their passive income. Section 121 (formerly
Section 119) of the Tax Code reads:
SEC. 121. Tax on banks and Non-bank financial
intermediaries. — There shall be collected a tax on gross receipts
derived from sources within the Philippines by all banks and non-bank
financial intermediaries in accordance with the following schedule:

(a) On interest, commissions and discounts from lending

activities as well as income from financial leasing, on the
basis of remaining maturities of instruments from which
such receipts are derived:

Short-term maturity (not in excess of two [2]

years) 5%

Medium-term maturity (over two [2] years but not

exceeding four [4] years) 3%

Long-term maturity —

(1) Over four (4) years but not exceeding

seven (7) years 1%

(2) Over seven (7) years 0%

(b) On dividends 0%

(c) On royalties, rentals of property, real or personal,

profits from exchange and all other items treated
as gross income under Section 32 of this
Code 5%

Provided, however, That in case the maturity period referred to

in paragraph (a) is shortened thru pretermination, then the maturity
period shall be reckoned to end as of the date of pretermination for
purposes of classifying the transaction as short, medium or long-term
and the correct rate of tax shall be applied accordingly.

Nothing in this Code shall preclude the Commissioner from

imposing the same tax herein provided on persons performing similar
banking activities.

I - G.R. No. 139786

Citytrust, respondent, is a domestic corporation engaged in quasi-
banking activities. In 1994, Citytrust reported the amount of
P110,788,542.30 as its total gross receipts and paid the amount of
P5,539,427.11 corresponding to its 5% GRT.
Meanwhile, on January 30, 1996, the CTA, in Asian Bank Corporation v.
Commissioner of Internal Revenue 7 (ASIAN BANK case), ruled that the basis
in computing the 5% GRT is the gross receipts minus the 20% FWT. In other
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 words, the 20% FWT on a bank's passive income does not form part of the
taxable gross receipts.
On July 19, 1996, Citytrust, inspired by the above-mentioned CTA
ruling, filed with the Commissioner a written claim for the tax refund or
credit in the amount of P326,007.01. It alleged that its reported total gross
receipts included the 20% FWT on its passive income amounting to
P32,600,701.25. Thus, it sought to be reimbursed of the 5% GRT it paid on
the portion of 20% FWT or the amount of P326,007.01.
On the same date, Citytrust filed a petition for review with the CTA,
which eventually granted its claim. 8
On appeal by the Commissioner, the Court of Appeals affirmed the CTA
Decision, citing as main bases Commissioner of Internal Revenue v. Tours
Specialist Inc. 9 and Commissioner of Internal Revenue v. Manila Jockey Club,
10 holding that monies or receipts that do not redound to the benefit of the

taxpayer are not part of its gross receipts, thus:

Patently, as expostulated by our Supreme Court, monies or
receipts that do not redound to the benefit of the taxpayer are
not part of its gross receipts for the purpose of computing its
taxable gross receipts. In Manila Jockey Cl ub, a portion of the wager
fund and the ten-peso contribution, although actually received by the
Club, was not considered as part of its gross receipts for the purpose of
imposing the amusement tax. Similarly, in Tours Specialists , the room
or hotel charges actually received by them from the foreign travel
agency was, likewise, not included in its gross receipts for the
imposition of the 3% contractor's tax. In both cases, the fees, bets or
hotel charges, as the case may be, were actually received and held in
trust by the taxpayers. On the other hand, the 20% final tax on
the Respondent's passive income was already deducted and
withheld by various withholding agents. Hence, the actual or
the exact amount received by the Respondent, as its passive
income in the year 1994, was less the 20% final tax already
withheld by various withholding agents. The various
withholding agents at source were required under section 50
(a), of the National Internal Revenue Code of 1986, to withhold
the 20% final tax on certain passive income . . . . SIcCTD

Moreover, under Section 51 (g) of the said Code, all taxes

withheld pursuant to the provisions of this Code and its
implementing regulations are considered trust funds and shall
be maintained in a separate account and not commingled with
any other funds of the withholding agent.
Accordingly, the 20% final tax withheld against the
Respondent's passive income was already remitted to the
Bureau of Internal Revenue, for the corresponding year that
the same was actually withheld and considered final
withholding taxes under Section 50 of the same Code.
Indubitably, to include the same to the Respondent's gross
receipts for the year 1994 would be to tax twice the passive
income derived by Respondent for the said year, which would
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 constitute double taxation anathema to our taxation laws.

II - G.R. No. 140857

Asianbank, petitioner, is a domestic corporation also engaged in
banking business. For the taxable quarters ending June 30, 1994 to June 30,
1996, Asianbank filed and remitted to the Bureau of Internal Revenue (BIR)
the 5% GRT on its total gross receipts.
On the strength of the January 30, 1996 CTA Decision in theASIAN
BANK case, Asianbank filed with the Commissioner a claim for refund of the
overpaid GRT amounting to P2,022,485.78.
To toll the running of the two-year prescriptive period for filing of
claims, Asianbank also filed a petition for review with the CTA.
On February 3, 1999, the CTA allowed refund in the reduced amount of
P1,345,743.01, 11 the amount proven by Asianbank. Unsatisfied, the
Commissioner filed with the Court of Appeals a petition for review.
On November 22, 1999, the Court of Appeals reversed the CTA
Decision and ruled in favor of the Commissioner, thus:
It is true that Revenue Regulation No. 12-80 provides that the
gross receipts tax on banks and other financial institutions should be
based on all items of income actually received. Actual receipt here is
used in opposition to mere accrual. Accrued income refers to income
already earned but not yet received. ( Rep. v. Lim Tian Teng Sons & Co.,
16 SCRA 584).
But receipt may be actual or constructive . Article 531 of the
Civil Code provides that possession is acquired by the material
occupation of a thing or the exercise of a right, or by the fact that it is
subject to the action of one will, or by the proper acts and legal
formalities established for acquiring such right. Moreover, taxation
income may be received by the taxpayer himself or by someone
authorized to receive it for him (Art. 532, Civil Code). The 20% final
tax withheld from interest income of banks and other similar
institutions is not income that they have not received; it is
simply withheld from them and paid to the government, for
their benefit. Thus, the 20% income tax withheld from the
interest income is, in fact, money of the taxpayer bank but
paid by the payor to the government in satisfaction of the
bank's obligation to pay the tax on interest earned. It is the
bank's obligation to pay the tax. Hence, the withholding of the
said tax and its payment to the government is for its benefit.
xxx xxx xxx
The case of Collector of Internal Revenue vs. Manila Jockey Club
is inapplicable. In that case, a percentage of the gross receipts to be
collected by the Manila Jockey Club was earmarked by law to be turned
over to the Board on Races and distributed as prizes among owners of
winning horses and authorized bonus for jockeys. The Manila Jockey
Club itself derives no benefit at all from earmarked percentage. That is
why it cannot be considered as part of its gross receipts.
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 WHEREFORE, the C.T.A's judgment herein appealed from is
hereby REVERSED, and judgment is hereby rendered DISMISSING
the respondent's Petition for Review in C.T.A Case No. 5412.

SO ORDERED.

Hence, the present consolidated petitions.

The Commissioner's arguments in the two (2) petitions may be
synthesized as follows:
first, there is no law which excludes the 20% FWT from the
taxable gross receipts for the purpose of computing the 5% GRT;

second, the imposition of the 20% FWT on the bank's passive

income and the 5% GRT on its taxable gross receipts, which include the
bank's passive income, does not constitute double taxation;

third, the ruling by this Court in Manila Jockey Club, 12 cited in

the ASIAN BANK case, is not applicable; and

fourth, in the computation of the 5% GRT, the passive income

need not be actually received in order to form part of the taxable gross
receipts.

In its Resolution 13 dated January 17, 2000, this Court adopted as

Citytrust's Comment on the instant petition for review its Memorandum
submitted to the CTA and its Comment submitted to the Court of Appeals.
Citytrust contends therein that: first, Section 4(e) of Revenue Regulations
No. 12-80 dated November 7, 1980 provides that the rates of taxes on the
gross receipts of financial institutions shall be based only on all items of
income actually received; and, second, this Court's ruling in Manila Jockey
Club 14 is applicable. Asianbank echoes similar arguments.
We rule in favor of the Commissioner.
The issue of whether the 20% FWT on a bank's interest income forms
part of the taxable gross receipts for the purpose of computing the 5% GRT
is no longer novel. This has been previously resolved by this Court in a
catena of cases, such as China Banking Corporation v. Court of Appeals, 15
Commissioner of Internal Revenue v. Solidbank Corporation, 16
Commissioner of Internal Revenue v. Bank of Commerce, 17 and the latest,
Commissioner of Internal Revenue v. Bank of the Philippine Islands. 18
The above cases are unanimous in defining "gross receipts" as "the
entire receipts without any deduction." We quote the Court's
enlightening ratiocination in Bank of the Philippines Islands, 19 thus:
The Tax Code does not provide a definition of the term "gross
receipts". Accordingly, the term is properly understood in its plain and
ordinary meaning and must be taken to comprise of the entire receipts
without any deduction. We, thus, made the following disquisition in
Bank of Commerce:
The word "gross" must be used in its plain and
ordinary meaning. It is defined as "whole, entire, total,
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 without deduction." A common definition is "without
deduction." "Gross" is also defined as "taking in the
whole; having no deduction or abatement; whole, total as
opposed to a sum consisting of separate or specified
parts." Gross is the antithesis of net. Indeed, in China
Banking Corporation v. Court of Appeals, the Court defined the
term in this wise:
As commonly understood, the term "gross
receipts" means the entire receipts without any
deduction. Deducting any amount from the gross
receipts changes the result, and the meaning, to net
receipts. Any deduction from gross receipts is inconsistent
with a law that mandates a tax on gross receipts, unless
the law itself makes an exception. As explained by the
Supreme Court of Pennsylvania in Commonwealth of
Pennsylvania v. Koppers Company, Inc. —
Highly refined and technical tax concepts have
been developed by the accountant and legal
technician primarily because of the impact of federal
income tax legislation. However, this is no way
should affect or control the normal usage of words in
the construction of our statutes; and we see nothing
that would require us not to include the proceeds
here in question in the gross receipts allocation
unless statutorily such inclusion is prohibited. Under
the ordinary basic methods of handling
accounts, the term gross receipts, in the
absence of any statutory definition of the term,
must be taken to include the whole total gross
receipts without any deductions, . . . . [Citations
omitted] (Emphasis supplied)"
Likewise, in Laclede Gas Co. v. City of St. Louis , the
Supreme Court of Missouri held:
The word "gross" appearing in the term "gross
receipts," as used in the ordinance, must have been
and was there used as the direct antithesis of the
word "net." In its usual and ordinary meaning, "gross
receipts" of a business is the whole and entire
amount of the receipts without deduction, . . . . On
the ordinary, "net receipts" usually are the receipts
which remain after deductions are made from the
gross amount thereof of the expenses and cost of
doing business, including fixed charges and
depreciation. Gross receipts become net receipts
after certain proper deductions are made from the
gross. And in the use of the words "gross receipts,"
the instant ordinance, or course, precluded plaintiff
from first deducting its costs and expenses of doing
business, etc., in arriving at the higher base figure
upon which it must pay the 5% tax under this
ordinance. (Emphasis supplied)
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 xxx xxx xxx

Additionally, we held in Solidbank, to wit:

[W]e note that US cases have persuasive effect in our
jurisdiction because Philippine income tax law is patterned after
its US counterpart.
[G]ross receipts with respect to any period means the
sum of: (a) The total amount received or accrued during
such period from the sale, exchange, or other disposition of
. . . other property of a kind which would properly be
included in the inventory of the taxpayer if on hand at the
close of the taxable year, or property held by the taxpayer
primarily for sale to customers in the ordinary course of its
trade or business, and (b) The gross income, attributable to
a trade or business, regularly carried on by the taxpayer,
received or accrued during such period . . . .
. . . [B]y gross earnings from operations . . . was
intended all operations . . . including incidental,
subordinate, and subsidiary operations, as well as principal
operations.

When we speak of the "gross earnings" of a person or

corporation, we mean the entire earnings or receipts of
such person or corporation from the business or operation
to which we refer.
From these cases, "gross receipts" refer to the total,
as opposed to the net income. These are therefore the total
receipts before any deduction for the expenses of
management. Webster's New International Dictionary, in
fact, defines gross as "whole or entire."
cHaDIA

I n China Banking Corporation, 20 this Court further explained that the

legislative intent to apply the term in its plain and ordinary meaning may be
surmised from a historical perspective of the levy on gross receipts. From
the time the GRT on banks was first imposed in 1946 under Republic Act No.
39 21 and throughout its successive re-enactments, 22 the legislature has not
established a definition of the term "gross receipts." Under Revenue
Regulations No. 12-80 and No. 17-84, as well as several numbered rulings,
the BIR has consistently ruled that the term "gross receipts" does not
admit of any deduction. This interpretation has remained unchanged
throughout the various re-enactments of the present Section 121 of the Tax
Code. On the presumption that the legislature is familiar with the
contemporaneous interpretation of a statute given by the administrative
agency tasked to enforce the statute, the reasonable conclusion is that the
legislature has adopted the BIR's interpretation. In other words, the
subsequent re-enactments of the present Section 121, without changes in
the term interpreted by the BIR, confirm that its interpretation carries out
the legislative purpose.
Now, bereft of any laudable statutory basis, Citytrust and Asianbank
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 simply anchor their argument on Section 4(e) of Revenue Regulations No.
12-80 stating that "the rates of taxes to be imposed on the gross receipts of
such financial institutions shall be based on all items of income actually
received." They contend that since the 20% FWT is withheld at source and
is paid directly to the government by the entities from which the banks
derived the income, the same cannot be considered actually received,
hence, must be excluded from the taxable gross receipts.
The argument is bereft of merit.
First, Section 4(e) merely recognizes that income may be taxable
either at the time of its actual receipt or its accrual, depending on the
accounting method of the taxpayer. It does not really exclude accrued
interest income from the taxable gross receipts but merely postpones its
inclusion until actual payment of the interest to the lending bank. Thus,
while it is true that Section 4(e) states that "the rates of taxes to be imposed
on the gross receipts of such financial institutions shall be based on all items
of income actually received," it goes on to distinguish actual receipt from
accrual, i.e., that "mere accrual shall not be considered, but once
payment is received in such accrual or in case of prepayment, then
the amount actually received shall be included in the tax base of
such financial institutions."
And second, Revenue Regulations No. 12-80, issued on November 7,
1980, had been superseded by Revenue Regulations No. 17-84 issued on
October 12, 1984. Section 4(e) of Revenue Regulations No. 12-80 provides
that only items of income actually received shall be included in the tax
base for computing the GRT. On the other hand, Section 7(c) of Revenue
Regulations No. 17-84 includes all interest income in computing the GRT,
thus:
SECTION 7. Nature and Treatment of Interest on Deposits and
Yield on Deposit Substitutes. —
(a) The interest earned on Philippine Currency bank deposits and
yield from deposit substitutes subjected to the withholding
taxes in accordance with these regulations need not be
included in the gross income in computing the
depositor's/investor's income tax liability in accordance
with the provision of Section 29 (b), (c) and (d) of the
National Internal Revenue Code, as amended.

(b) Only interest paid or accrued on bank deposits, or yield from

deposit substitutes declared for purposes of imposing the
withholding taxes in accordance with these regulations
shall be allowed as interest expense deductible for
purposes of computing taxable net income of the payor.

(c) If the recipient of the above-mentioned items of

income are financial institutions, the same shall be
included as part of the tax base upon which the
gross receipt tax is imposed.

Revenue Regulations No. 17-84 categorically states that if the

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 recipient of the above-mentioned items of income are financial
institutions, the same shall be included as part of the tax base upon
which the gross receipt tax is imposed . There is, therefore, an implied
repeal of Section 4(e). There exists a disparity between Section 4(e) which
imposes the GRT only on all items of income actually received (as
opposed to their mere accrual) and Section 7(c) which includes all interest
income (whether actual or accrued) in computing the GRT. As held by this
Court in Commissioner of Internal Revenue v. Solidbank Corporation, 23 "the
exception having been eliminated, the clear intent is that the later
R.R. No. 17-84 includes the exception within the scope of the
general rule." Clearly, then, the current Revenue Regulations require
interest income, whether actually received or merely accrued, to form part
of the bank's taxable gross receipts. 24
Moreover, this Court, in Bank of Commerce, 25 settled the matter by
holding that "actual receipt may either be physical receipt or constructive
receipt," thus:
Actual receipt of interest income is not limited to physical
receipt. Actual receipt may either be physical receipt or
constructive receipt. When the depositary bank withholds the
final tax to pay the tax liability of the lending bank, there is
prior to the withholding a constructive receipt by the lending
bank of the amount withheld. From the amount constructively
received by the lending bank, the depositary bank deducts the final
withholding tax and remits it to the government for the account of the
lending bank. Thus, the interest income actually received by the
lending bank, both physically and constructively, is the net interest
plus the amount withheld as final tax.
The concept of a withholding tax on income obviously and
necessarily implies that the amount of the tax withheld comes from the
income earned by the taxpayer. Since the amount of the tax withheld
constitute income earned by the taxpayer, then that amount
manifestly forms part of the taxpayer's gross receipts. Because the
amount withheld belongs to the taxpayer, he can transfer its
ownership to the government in payment of his tax liability. The
amount withheld indubitably comes from the income of the taxpayer,
and thus forms part of his gross receipts.

Corollarily, the Commissioner contends that the imposition of the 20%

FWT and 5% GRT does not constitute double taxation.
We agree.
Double taxation means taxing for the same tax period the same thing
or activity twice, when it should be taxed but once, for the same purpose
and with the same kind of character of tax. 26 This is not the situation in the
case at bar. The GRT is a percentage tax under Title V of the Tax Code
([Section 121], Other Percentage Taxes), while the FWT is an income tax
under Title II of the Code (Tax on Income). The two concepts are different
from each other. In Solidbank Corporation, 27 this Court defined that a
percentage tax is a national tax measured by a certain percentage of the
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 gross selling price or gross value in money of goods sold, bartered or
imported; or of the gross receipts or earnings derived by any person
engaged in the sale of services. It is not subject to withholding. An income
tax, on the other hand, is a national tax imposed on the net or the gross
income realized in a taxable year. It is subject to withholding. Thus, there
can be no double taxation here as the Tax Code imposes two different kinds
of taxes.
Now, both Asianbank and Citytrust rely on Manila Jockey Club 28 in
support of their positions. We are not convinced. In said case, Manila Jockey
Club paid amusement tax on its commission in the total amount of bets
called wager funds from the period November 1946 to October 1950. But
such payment did not include the 5 1/2% of the funds which went to the
Board on Races and to the owners of horses and jockeys. We ruled that the
gross receipts of the Manila Jockey Club should not include the 5 1/2%
because although delivered to the Club, such money has been especially
earmarked by law or regulation for other persons. CHcETA

The Manila Jockey Club 29 does not apply to the cases at bar because
what happened there is earmarking and not withholding. Earmarking is not
the same as withholding. Amounts earmarked do not form part of gross
receipts because these are by law or regulation reserved for some person
other than the taxpayer, although delivered or received. On the contrary,
amounts withheld form part of gross receipts because these are in
constructive possession and not subject to any reservation, the withholding
agent being merely a conduit in the collection process. 30 The distinction
was explained in Solidbank, thus:
"The Manila Jockey Club had to deliver to the Board on Races,
horse owners and jockeys amounts that never became the property of
the race track (Manila Jockey Club merely held that these amounts
were held in trust and did not form part of gross receipts). Unlike
these amounts, the interest income that had been withheld for
the government became property of the financial institutions
upon constructive possession thereof. Possession was indeed
acquired, since it was ratified by the financial institutions in
whose name the act of possession had been executed. The
money indeed belonged to the taxpayers; merely holding it in
trust was not enough (A trustee does not own money received
in trust.) It is a basic concept in taxation that such money does not
constitute taxable income to the trustee [China Banking Corp. v. Court
of Appeals, supra, p. 27]).
The government subsequently becomes the owner of the
money when the financial institutions pay the FWT to
extinguish their obligation to the government. As this Court
has held before, this is the consideration for the transfer of
ownership of the FWT from these institutions to the
government (Ibid., p. 26). It is ownership that determines
whether interest income forms part of taxable gross receipts
(Ibid., p. 27). Being originally owned by these financial
institutions as part of their interest income, the FWT should
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 form part of their taxable gross receipts.

In fine, let it be stressed that tax exemptions are highly disfavored. It is

a governing principle in taxation that tax exemptions are to be construed in
strictissimi juris against the taxpayer and liberally in favor of the taxing
authority and should be granted only by clear and unmistakable terms.
WHEREFORE, in G.R. No. 139786, we GRANT the petition of the
Commissioner of Internal Revenue and REVERSE the Decision of the Court of
Appeals dated August 17, 1999 in CA-G.R. SP No. 52707.
In G.R. No. 140857, we DENY the petition of Asianbank Corporation and
AFFIRM in toto the Decision of the Court of Appeals in CA-G.R. SP No.
51248. Costs against petitioner. HDAaIS

SO ORDERED.
Puno, Corona, Azcuna and Garcia, JJ., concur.

Footnotes
1. Also referred to as "interest income" as it pertains to interest from bank
deposits and yield or any other monetary benefit from deposit substitutes
and from trust funds and similar arrangements and royalties.
2. Entitled Commissioner of Internal Revenue v. Citytrust Investment Phils., Inc .,
penned by Associate Justice Romeo J. Callejo, Sr. (now a member of this
Court) and concurred in by Associate Justice Quirino D. Abad Santos, Jr. and
Associate Justice Mariano M. Umali (both retired).
3. CTA Case No. 5403, entitled Citytrust Investment Philippines, Inc. v.
Commissioner of Internal Revenue, penned by Associate Justice Ramon O. De
Veyra.

4. Entitled Commissioner of Internal Revenue v. Asianbank Corporation , penned by

Associate Justice Hector L. Hofileña (retired) and concurred in by Associate
Justice Omar U. Amin (retired) and Associate Justice Jose L. Sabio, Jr.

5. CTA Case No. 5412.

6. This tax is withheld at source and is thus not actually and physically received by
the banks, because it is paid directly to the government by the entities from
which the banks derived the income. (Commissioner of Internal Revenue v.
Solidbank Corporation, G.R. No. 148191, November 25, 2003, 416 SCRA
436.)
7. CTA Decision in CTA Case No. 4720.

8. On April 19, 1999, the Court of Tax Appeals rendered a Decision, the dispositive
portion of which reads:

  "WHEREFORE, in view of the foregoing, Respondent is hereby ORDERED to

REFUND or to ISSUE a tax credit certificate in favor of Petitioner in the
amount of P39,629.44 representing overpaid gross receipts tax for the
taxable year 1994."

9. G.R. No. 66416, March 21, 1990, 183 SCRA 402.

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 10. 108 Phil. 821 (1960).

11. The amount as alleged in the petition; P1,345,749.01, as it appears in the CA

decision.
12. Supra, footnote 10.

13. Rollo , p. 50.

14. Supra.

15. G.R. No. 146749, June 10, 2003, 403 SCRA 634.

16. Supra, footnote 6.

17. G.R. No. 149636, June 8, 2005, 459 SCRA 638.

18. G.R. No. 147375, June 26, 2006.

19. Id.
20. Supra, footnote 15.

21. Republic Act No. 39 amended Section 249 of the Tax Code of 1939 (effective
October 1, 1946), which states:
  "Sec. 249. Tax on banks. — There shall be collected a tax of five per centum
on the gross receipts derived by all banks doing business in the Philippines
from interests, discounts, dividends, commissions, profits from exchange,
royalties, rentals of property, real and personal, and all other items treated
as gross income under section twenty-nine of this Code."
22. Since 1 October 1946 when R.A. No. 39 first imposed the gross receipts tax on
banks under Section 249 of the Tax Code, the legislature has re-enacted
several times this section of the Tax Code. On 24 December 1972,
Presidential Decree No. 69, which enacted into law the Omnibus Tax Bill of
1972, re-enacted Section 249 of the Tax Code. Then on 11 June 1977,
Presidential Decree No. 1158, otherwise known as the National Internal
Revenue Code of 1977 , re-enacted Section 249 as Section 119 of the Tax
Code. Finally, on 11 December 1997, Republic Act No. 8424, otherwise
known as the Tax Reform Act of 1987 , re-enacted Section 119 as the present
Section 121 of the Tax Code. (See China Banking Corporation v. Court of
Appeals, supra).
23. Supra, footnote 6.

24. Supra, footnote 18.

25. Supra, footnote 17.

26. Tax Law and Jurisprudence, by Justice Jose C. Vitug and Judge Ernesto D.
Acosta, Second Edition, 2000.

27. Supra, footnote 6.

28. Supra, footnote 10.

29. Id.

30. Supra, footnote 6.

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